On Thursday, April 21, 2005, at 01:44 PM, Roger M. Wiser wrote: > How about the return on the investment on Concorde? > > Roger That went right though the roof, admittedly. All the same there's something fishy about the Concorde cancellation. I=20= wrote a post about it on another mailing group as follows: [QUOTE] March 9, 2005 Since a long time we've been told that the supersonic airliner Concorde=20= was "too expensive to operate". Some people even say that "each=20 passenger who has flown on the jet has, in effect, been subsidised by=20 about =A33,000 per trip." Oh, really? Let's do some simple calculations, shall we. The specifications of the=20= Concorde are no secret: they are available on the Web for all to check=20= out. It turns out that each Concorde used to fly a typical payload of=20 100 passengers across the Atlantic in about 3 hours on a single tankful=20= of fuel, which in its case amounted to around 26,000 US gallons. Each=20 Concorde had a flight crew of 9 or 10. Each Concorde required - let's=20 be generous - maybe another 90 people on the ground to keep it flying.=20= That makes a total of 100 people working full shifts to keep the 100=20 paying passengers in the air for three hours. Expensive, huh. And the 20 Concordes which were eventually made were made at a cost, in=20= 2004 US dollars, which has variously been given as anything from $13=20 billion to $32 billion, making it by far the most expensive civilian=20 aircraft ever made. Let's take $20 billion as a nice round average=20 figure, then each Concorde cost about $1 billion per plane. The word=20 "expensive" is, in fact, much too mild. "Bloody effin' expensive" is=20 more like it. But, and this is a big "but", that money was all paid by the British=20 and French taxpayers, not by British Airways or by Air France, who were=20= given the planes for just =A31 each! However, let's factor the=20 manufacturing price into the equation, just to satisfy the critics,=20 okay? Now the Concorde has had a very long run: since the October 1, 1969,=20 when the first one flew, all the way to the year 2004: which is to say,=20= 35 years or thereabouts. Given the high speed at which each of them=20 flew, each could easily have made two trips across the Atlantic in any=20= given 24-hour period; but let's say, for the sake of being generous to=20= the critics, that each made only one transatlantic flight in every 24=20 hours, and that in any given year each flew, on the average, only 300=20 days out of the 365. That still leaves each Concorde making over 10,000=20= trips over its lifetime. (Note that most other airliners fly between 7=20= and 12 hours in every 24 hour period, so the less-than-3-hours-per-day=20= average we are assuming for the Concorde is VERY conservative!) However, even at the low figure of less than 3 hours per day, the=20 enormous cost of each Concorde could be depreciated at the rate of less=20= than $100,000 per trip, right? $1 billion in 2004 US dollars divided by=20= 10,000 is a mere $100,000, again in 2004 US dollars. And suppose maintenance of these twenty planes on the ground over those=20= 35 years has cost, in total, just as much as the twenty planes=20 originally cost to make. No plane is THAT expensive to maintain, but=20 let's say the Concorde was. Even then, the maintenance cost per plane=20 per flight was still only $100,000, in 2004 US dollars! And the fuel per trip would amount, at today's prices for jet fuel,=20 which hover at around $1.55 per gallon, to $40,300. Heck, let's round=20 it up to $2.00 per gallon: it would still amount to only $52,000, in=20 2004 dollars. And let's say each person of the 100-person air-plus-ground-crew was=20 paid, in today's prices, US $500 a day (only the highest-paid airline=20 personnel are paid as much as US $500 a day, but let's be generous to=20 the critics and say that all of them were paid that much): that still=20 amounts to only $50,000 per flight, in 2004 US dollars! And let's say each passenger used to consume food and drink worth $500=20= on each flight. No one consumes food and drink worth $500 on a=20 three-hour flight: I certainly didn't, not the last time I flew, even=20 on those rare occasions when I flew first class: but what the heck,=20 let's say they ALL used to feast at Mach 2 on foie-gras and truffles=20 and caviar, and wash it all down with the best champagne: the food bill=20= would still have been only $50,000 per flight, in 2004 dollars. So what does it all add up to? Do the math: it's a mere $352,000 per=20 flight! Depreciation: $100,000 per flight Maintenance: $100,000 per flight Fuel: $ 52,000 per flight Personnel: $ 50,000 per flight Food & Drinks: $ 50,000 per flight TOTAL: $352,000 per flight Round it up to $400,000, in 2004 US dollars, to account for insurance=20 and airport fees and other incidentals - heck, round it off generously=20= to HALF A MILLION dollars, in case I've forgotten something - and it's=20= still a pittance. Because the price of a round trip ticket on the Concorde, when it was=20 last flying with Henry Kissinger and Mick Jagger and Elton John and=20 other celebs and businessmen and investment bankers on board, was as=20 much as $15,000 per person! (Not that they couldn't afford even twice=20 that much, the frequent flyers on the Concorde were pretty much all=20 gazillionaires.) That makes a total of $1.5 million in revenue for two=20= trips, or $750,000 per trip. Enough to make a tidy QUARTER OF A MILLION=20= dollars profit for the airline! But hey! Why fly celebrities and investment bankers when the Concorde=20 can fly freight or documents even more profitably? The Concorde's=20 typical payload was about 25,000 pounds. Transatlantic overnight=20 freight nowadays, like via FedEx, flies on regular subsonic aircraft=20 for about $35 per half-pound-maximum-weight FedEx envelope, which is to=20= say, $70 per lb. - and that's just able to "reach major business=20 centers in 24 to 48 hours" (check out the prices using the FedEx rate=20 finder on the Web at http://www.fedex.com/ratefinder/shipInfo). But=20 since the Concorde could offer SAME DAY service between New York and=20 London or Washington and Paris, it could charge even more, at least=20 $100 per pound. And at that price a courier airline could make $2.5=20 million per one-way trip for a fully laden Concorde =85 and since = freight=20 doesn't gobble up any caviar nor guzzle down any champagne, nor does it=20= require curvaceous flight attendants to serve these delicacies, the=20 cost per trip would go down to - what? maybe about $300,000, in 2004 US=20= dollars, leaving an even huger profit! Yes, yes, yes, I hear all you sceptics loudly clamouring that a big=20 chunk of that $100-per-pound would go towards transporting the=20 envelopes to and from the two airports, one on each side of the=20 Atlantic, but how much can that be? More than 50%? More than 70%? Yeah,=20= raaaaaaaaight. But even if that were true, it STILL leaves the Concorde making a=20 profit of almost half a million dollars per flight! And note that all this is based upon calculations which give the=20 critics the benefit of the doubt. In actual fact the operating costs of=20= the Concorde would NOT have included its depreciation (which was paid=20 for by the taxpayers), nor can it have cost THAT much to maintain the=20 Concorde over its 35-year flying life ($20 billion dollars!!!), nor can=20= it have needed THAT may people to look after each Concorde on the=20 ground, nor can they have been paid THAT much, not can the passengers=20 have been eating and drinking THAT much food and drink per flight! And neither, of course, can it cost FedEx $70 per pound to transport=20 their half-pound-max-weight envelopes to and from the airport, because=20= if that were the case, how could FedEx make any money charging just $70=20= per pound to ship their envelopes at sub-sonic speeds? But of course no one is telling us the TRUE costs of operating the=20 Concorde. In fact, British Airways aren't even willing to show them to=20= Richard Branson, owner of Virgin Atlantic, as indicated by documents=20 published on the UK government's own web site (see=20 http://www.dft.gov.uk/stellent/groups/dft_foi/documents/=20 divisionhomepage/035683.hcsp)! Branson wants to buy five of the=20 now-grounded Concordes for =A31 million each (see news story at=20 http://news.airwise.com/stories/2003/06/1056381143.html), claiming that=20= he could surely make the planes profitable, but British Airways don't=20 want to sell even one of them. WHY? Why would they rather make NOTHING=20= AT ALL than make at least $5 million? Lemme ask you: Is this fishy or is this fishy. What the HELL is going=20 on? I am not saying the Concorde was an environmentally sound plane, nor=20 that it was cheap to make and operate, compared with all other=20 airliners. But I AM saying that it makes no sense to say it was not=20 PROFITABLE. If anyone claims it was, why are they not publishing the=20 figures to prove their claims? Are we supposed to believe what they say=20= simply because they say it? Come ON. [END QUOTE] Tell me now what YOU think. Cheers.